In state capitals, some governors are considering whether to opt out of one of the law’s most fundamental provisions: the expansion of Medicaid to cover 17 million of the poorest Americans.
And in Congress, Republicans still want to repeal the measure.
The two-year-old Affordable Care Act faces a slew of political and legal challenges from critics who want either to kill it or to alter the way it is implemented.
Arguably the most portentious question raised by the ruling is whether states will go along with the law’s expansion, beginning in 2014, of Medicaid to cover a larger share of the poor. The justices said the federal government can no longer punish a state that refuses to comply with the expansion by withholding funding from the state’s Medicaid program.
White House officials said they are confident that no states will back out.
Ronald Pollack, head of the advocacy group Families USA, which supports the law, also was optimistic. He argued that although the federal government may have lost a powerful stick, it still has a juicy carrot: hundreds of billions of dollars in federal aid.
For the first three years, he noted, the government will pay the entire cost of expanding Medicaid. As a result, from 2014 to 2019, the expansion will cause state spending on Medicaid to increase by only 1.4 percent, according to a study sponsored by the Kaiser Family Foundation. Even after the federal share is phased down, it will still amount to 90 percent.
“This is an incredible bargain that states are not going to want to refuse,” Pollack said.
Matt Salo, executive director of the National Association of Medicaid Directors, cautioned that cash-strapped state leaders may not see it that way.
Footing even just 10 percent of the bill for the expansion could prove daunting for states with the least-generous Medicaid programs. Texas, for example, covers only parents with incomes up to 26 percent of the federal poverty line, or about $2,900. To participate in the Medicaid expansion — which extends coverage to all individuals and families with incomes up to 133 percent of the federal poverty level — the state would have to spend $2.6 billion between 2014 and 2019, according to the Kaiser report.
State officials also worry that the federal match could go down over time, Salo said.
“There isn’t a state out there that isn’t fully aware that you’ve seen Congress and the White House talk about lowering Medicaid funding, and thinking that could go down,” he added.
A spokesperson for Texas Gov. Rick Perry (R), an opponent of the law, said the governor has not decided whether to proceed with the Medicaid expansion — a response echoed by leaders of other states that challenged the law.
The stakes are immense, said Joan Alker, co-executive director of the Center for Children and Families at Georgetown University. The Medicaid expansion is projected to help 17 million Americans gain insurance — nearly half of the estimated 34 million who will be newly covered under the law.